Best is better than biggest
Top team: from left, Chubb Head of Distribution Demetra Day, Head of Property & Casualty Chris Gough, Head of Accident & Health Amy McKellar, and Country President Peter Kelaher
When Ace completed the acquisition of Chubb in 2016 to create the world’s largest publicly traded property and casualty insurer, it announced it would take on the renowned Chubb brand.
The industry giant may not be the biggest in the local market, but as Australia and New Zealand Country President Peter Kelaher tells Insurance News, it aims to be the best in those areas it dominates.
Chubb sits on about 3% market share because, being 90% intermediated, it doesn’t have the large personal lines portfolios of its competitors. At the end of last year it was ranked fifth-largest general insurer by Australian Prudential Regulation Authority statistics.
The company is known for looking after people at the top, claiming more than 70% of the ASX 250 companies on its books, and a prestigious high net worth home product, Masterpiece.
And it has growth in mind with a technology-powered SME offering gaining traction, and other personal lines possibilities through partnerships being explored.
“Where we have traditionally played, which is in the specialty lines, in property and casualty, I think we’re always going to be a first choice with brokers to have on their client’s program,” Mr Kelaher says.
“In our accident and health business we’ve also now got a number of partnerships which make our proposition regionally very strong. And our other real strength is in high net worth home and contents, where we see ourselves as market leaders.
“Put that together with our underwriting discipline and very strong claims proposition – we’re attractive to brokers and clients.”
Masterpiece can be viewed as a microcosm of Chubb’s broader business, and its attitude towards service and claims.
“Success comes from personalised service, and the way in which you respond to a claim,” Mr Kelaher tells Insurance News.
He says the key to the success of Masterpiece is “upfront understanding”, brought about by clients working with Chubb to build a property file that’s highly detailed. “It means we can move much quicker in the claims process.”
Chubb’s reputation in claims service is hard-earned, and Mr Kelaher says it’s never taken for granted.
But he saves his greatest praise for the people who make the business successful.
“The best claims service means the best claims people, and some of our people have been here for 30 or 40 years.”
Mr Kelaher joined Chubb in 2007, taking over the top local role in 2021 following the departure to IAG of former country president Jarrod Hill.
He’s uncompromising in his approach to excellence, admitting that not everyone fits the Chubb mould. “You hire a certain person who is really passionate about the industry [and] passionate about the promise we make in the policies that we sell.
“The culture here is very dynamic and performance-based, so when you’re adding people to that environment, you expect them to operate at a certain level.”
The demand for excellence in underwriting risks also means Chubb’s underwriters must be willing to dig deeper. “We probably ask a little bit more from our underwriters to understand the risk, and where that risk fits into the portfolio.”
With a war for talent in full swing across the industry, amid high employment and a covid-induced deficit of professionals from overseas, how does Chubb find and keep the best recruits?
Mr Kelaher says Chubb runs a range of development programs. Two years ago, the graduate program was launched, and a “junior board” enables the company’s best young talent to advise the business. There’s also a mentoring program, and an acceleration program for aspiring female leaders.
“We have heavily invested in initiatives to develop people once they join Chubb, and we’re big promoters from within,” he says. “We love to continue to develop our own talent.”
While Chubb has no ambitions to go head-to-head with Australia’s personal lines giants, it does see other opportunities for growth.
Over the past five years it has invested heavily in its digital SME offering, and the growing lower-mid market is also in its sights.
“SME is a book that we’ve built up over time. It’s definitely an area we will continue to expand. It’s about having the right digital capability.
“The fact that we built [the small commercial business] from scratch means that we might be behind some of our competitors in terms of size, but the home-grown technology is compelling when you look at our ability to connect, update systems, update pricing and update a client offering.
“The fact our system was only built recently means we can be more agile than our competitors.”
Even in the “super-competitive” SME market, Mr Kelaher says the same Chubb principles around service apply.
“We remind ourselves that what we do for our high-net-worth customers, we’ve got to replicate for our small commercial insureds. But we have got to do it at a very different price point.
“So it’s a challenge, but one that we’re pretty excited about.”
Mr Kelaher still sees more room to grow in the high net worth home sector, and a recent partnership with insurtech Qikio sees it underwriting a digital contents solution. Travel is also expected to flourish again now the impact of covid is fading.
“We’ve got big ambitions in personal lines,” Mr Kelaher says. “With Qikio it was really about working together to deliver innovative and simple insurance solutions for customers.”
For Chubb in Australia, it’s about playing to strengths, building out certain areas of focus, and maintaining its reputation for claims and service excellence.
It will experiment where it sees opportunity but has no desire to be everything to everyone.
“We want to be the market leaders in the lines of business in which we operate,” Mr Kelaher says.
“We want to be sustainable in those markets, for our brokers and insureds, and we want to provide a premium offering for the long term.
“It’s definitely not about writing mass market the same way that some of our competitors do – you can’t offer the same claims service. You can’t offer it if you write every risk, or you try to write every risk.
“And we have to continue to be true to our brand and reputation for specialised and personalised service.”
“In the last four years we went through bushfires, floods, covid and more floods.
“These type of events are the new normal, and have led to a rise in reinsurance pricing, forcing insurers to assume more exposure and volatility or to shed risk.
“This presents an opportunity for Chubb. We’re not afraid of underwriting for catastrophe; with the appropriate level of expertise and collaboration with brokers and clients, we’re prepared to take more risk within reason. That’s the challenge that the industry faces.”
“We’ve seen underwriting agencies move into this area talking about the service that they provide.
“It’s arguably simpler to provide great service in that hard-to-place area at times, because that’s all you look at. The difference at a company the size and scale of Chubb is we’ll look at the full gamut of risks, from hard-to-place to your very vanilla.
“We work hard to find solutions for brokers and clients and I wouldn’t put us in the category of insurers that aren’t interested in hard-to-place. Chubb’s appetite hasn’t shifted at all, it just comes down to balancing the exposure with the pricing and risk management.”
“We’ve got great respect for all the brokers that we work with. I think they do a fantastic job supporting clients, particularly through the market cycles when oftentimes, clients can be faced with difficult circumstances, particularly if their insurer is looking to reduce capacity or walk away from an account.
“I wouldn’t underplay the role of the broker at all, I think they’ve got a significant role to play moving forward, particularly in the mid-market and in major accounts, supporting the complexity of what clients are facing.”